Economy

Nearly 50% of public sector mega projects running behind schedule

Arvind Jayaram BL Research Bureau | Updated on March 12, 2018 Published on July 08, 2012

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Original cost of the projects revised to Rs 6.8 lakh cr, against Rs 5.86 lakh cr earlier

As many as 32 of the 59 mega power projects being implemented by public sector firms (at a cost of over Rs 1,000 crore each) were running behind schedule as of end-March 2012.

The slippage against commissioning deadlines ranged between four and 83 months. Fourteen of these projects witnessed cost-overruns, with the anticipated expenditure on them rising by 35.2 per cent, taking their total value to a whopping Rs 2.04 lakh crore, according to a report by the Infrastructure and Project Monitoring Division of the Ministry of Statistics and Programme Implementation.

Petroleum sector

Implementation of mega-projects in the petroleum sector was also not up to the mark, with 19 out of 33 projects experiencing time overruns between one month and 120 months.

Nine of these were also experiencing cost-overruns, which has resulted in a 30 per cent rise in the total anticipated expenditure on these initiatives to Rs 1.39 lakh crore.

Railways

A number of projects in the railways (11 projects out of 33), road transport and highways (five out of 21), steel (five out of six), shipping and ports (four out of six) and atomic energy (four out of five) sectors were also running behind schedule as of March 2012. The time overrun on these projects ranged from one month to as much as 201 months.

Power projects

A total of 183 mega projects were being implemented in the country by the public sector as of the end of 2011-12. Out of these, 86 were experiencing time-overruns and 68 suffered cost-overruns.

The majority of the projects were being executed in sectors like power (59), petroleum (33), railways (33) and road transport and highways (21), besides coal (9), steel (6), shipping and ports (6), atomic energy (5), civil aviation (2), urban development (3), fertilisers (3), petrochemicals, telecommunication and water resources (one each).

The original cost of the 183 projects under implementation was Rs 5.86 lakh crore, but has since been revised to Rs 6.8 lakh crore, implying a 15.9 per cent cost-overrun. The expenditure incurred on these projects till March 2012 stood at Rs 2.91 lakh crore.

Nevertheless, there has been some progress on the mega-projects front, with the commissioning of 13 projects in the 2011-12 financial year( see table).

> arvind.jayaram@thehindu.co.in

Published on July 08, 2012
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